A cost-benefit analysis of a deposit–refund program for beverage containers in Israel

The paper presents a full cost-benefit analysis of a deposit–refund program for beverage containers in Israel. We examine all cost elements of the program – storage, collection, and treatment costs of empty containers, and all potential benefits – savings in alternative treatment costs (waste collection and landfill disposal), cleaner public spaces, reduction of landfill volumes, energy-savings externalities associated with use of recycled materials, and creation of new workplaces. A wide variety of data resources is employed, and some of the critical issues are examined via several approaches. The main finding of the paper is that the deposit–refund program is clearly economically worthwhile. The paper contributes to the growing body of literature on deposit–refund programs by its complete and detailed analysis of all relevant factors of such a program, and also specifically in its analysis of the savings in alternative waste management costs. This analysis reveals greater savings than are usually assumed, and thus shows the deposit–refund program to be highly efficient.